Friday Focus – Jan 23, 2026

4 minute read

Smart insight and clear visuals that matter – what we’re watching now and how intention and conviction shape our portfolios.

Markets

Economy

The United States economy expanded in the third quarter by slightly more than initially reported and supported by stronger exports and smaller drag from inventories. Initial jobless claims steadied at 200,000 last week. Resilient spending lowers near-term recession risk and supports corporate revenues, particularly in consumer-facing sectors, but also means interest rates may stay higher for longer.

Rate Cut Expectations

The U.S. economic surprise index jumped on the early January data and some of the delayed Q4 data rolling in. This has caused the bond market to re-rate Fed rate cut expectations. The first cut of the year is now priced-in for June like before, but the second cut has been pushed out to December. More cyclical parts of the U.S. markets like the industrials sector and smaller caps have done well.

Real Estate

Outlook

CBRE outlook on the CRE market is positive on the prospect of long-term yields around 4%. They expect ~16% increase in investment volume this year. In 2025, CBRE executed on the most confidentiality agreements with prospective property buyers since 2022, with sellers becoming more realistic on pricing.

Sector

• Office continues to recover and CBRE expects stronger demand for well-located Class A properties, a spillover from trophy assets.
• Industrial continues to work through excess supply following the pandemic construction boom. Modern assets in key metro with population growth and transportation hubs expected to outperform within sector.
• Retail continues to show strength across the board with health fundamentals amid little new supply. Risk-adjusted return looks “especially” attractive in well located grocery anchored and open air centers.
• Multifamily is working through supply overhang, particularly in sun-belt and mountain regions. Midwestern and gateways continue to maintain healthy fundamentals.
• CBRE expects hotels to present attractive opportunities as new supply diminishes and RevPar improves.

Oil

Halliburton and other major U.S. oil‑services companies, including SLB, Nabors Industries, and Helmerich & Payne, are eager to re‑enter Venezuela as sanctions ease, sensing a lucrative opportunity to help rebuild the country’s badly deteriorated oil infrastructure and revive long‑stalled contracts. After years of sanctions that left billions in equipment idle, these firms expect U.S. producers’ return to spark a surge in demand for drilling rigs, field services, and technical support. Their stocks have outperformed the broader market in anticipation of renewed activity, though executives remain cautious given the risk that political setbacks in Venezuela could trigger a snap‑back of U.S. sanctions.

Airlines/ Engines/ Data Centers

Our thirst for power is so insatiable, we are pulling aircraft from the graveyard, literally. Just outside Tucson (next to the World’s Largest Pin Truck and Dinoland USA) sits the Davis-Monathan Air Force base which has the world’s largest aircraft storage facility, THE BONEYARD, which began in 1946. It is 2,600 acres that houses half of the country’s 14,000 military aircraft as well as 7,000 aircraft engines that can be thought of as a strategic reserve where parts are harvested to keep active aircraft flying, saving taxpayer money.

• Some planes are there just for parts, but for power, one Wall Street house estimates ~3,400 retired military aircraft and ~7,000 engines currently stored at Boneyard could be used as a source of power capacity for aeroderivative solutions for data centers. The EIA estimates 40GW of potential power capacity could come from retired aircraft, with the majority built by General Electric (42%), Rolls Royce (31%), Pratt & Whitney (20%).
• 95% of what could be resurrected comes from the turbofan & turboprop, with 3% from turboshaft engines that could be eligible to be pulled into the datacenter gravitational pull. McKinsey's data center power demand forecast calls for a 23% CAGR through 2030 to >80 GW, reaching ~12% of US power demand. Data center operators continue to look for incremental power sources, given current constraints, with aeroderivative solutions playing an increasing role in bridging the gap.

Source: 309th Aerospace Maintenance and Regeneration Group, Cirium, Jefferies estimates

Economic Calendar: Week Ahead (Eastern Time)

Mon, 1/26 @ 830 am: Durable Goods Orders (Delayed Report)

Tues, 1/27 @ 10 am: Consumer Confidence

Wed, 1/28 @ 2 pm: FOMC interest-rate decision
@ 230 am: Fed Chair Powell Press Conference

Thu, 1/29 @ 830 am: Initial Jobless Claims
@ 830 am: U.S. Trade Deficit (Delayed Report)

Fri, 1/30 @ 830 am: Producer Price Index (Delayed Report)